Senate Finance Committee Ranking Member Orrin Hatch (R-Utah) and Senate Health, Education, Labor and Pensions (HELP) Committee Ranking Member Lamar Alexander (R-Tennessee) introduced the American Job Protection Act, which would repeal the provision in the health care reform law that requires businesses with 50 employees or more to provide health insurance of minimum value or pay a penalty between $2,000 and $3,000 for each employee working 30 hours or more a week.Companion legislation was introduced in the House by U.S. Representatives Charles Boustany Jr. (R-Louisiana), Pat Tiberi (R-Ohio) and John Barrow (D-Georgia).

The lawmakers claim that while the employer mandate does not go into effect until 2014, the requirement has already pushed many employers to keep their staffs below 50 or hire part-time workers to avoid the mandate. They cite a study by the U.S. Chamber of Commerce in which 72% of small business owners said the health care law would make it harder for them to hire. That same study reported, “Many small business owners reported that, in addition to limiting hiring, the new law might force them to reduce the size of their business. For example, respondents reported considering making workers stay under [30] hours a week or replacing them with temporary or part-time workers. A significant number reported the likelihood of canceling insurance coverage for employees, as paying the penalty would be less expensive for their company.”

They also say the Congressional Budget Office (CBO) found the mandate would hit employers with $150 billion in new taxes over eleven years, and a Hudson Institute study indicated the mandate is expected to lead to an estimated 3.2 million lost jobs.